Key Points
- City rate: US$0.10 per milliliter (mL) within city limits.
- Police-jurisdiction rate: US$0.05 per mL for sales or deliveries outside city limits but within the city’s police jurisdiction.
- Effective date: Targeted for October 1, 2025; the actual start of collection will be finalized by a follow-up resolution at the next council meeting.
- Rationale: To ensure the tax is municipal rather than state-level by taking effect before statewide restrictions on new local taxes begin on October 1, 2025.
- State backdrop: Alabama’s statewide vape tax is slated to take effect on October 1, 2026.
- Scope: Devices and nicotine-containing e-liquid containers that meet Alabama’s definition of “vapor products” are taxable.
2Firsts, September 16, 2025 — According to Fox54, the Decatur City Council has approved a new ordinance imposing a volume-based tax on e-cigarette (vapor) products. Under the ordinance, qualifying products sold within city limits will be taxed at US$0.10 per mL, while those sold or delivered outside city limits but within the city’s police jurisdiction will be taxed at US$0.05 per mL.
The ordinance is planned to take effect on October 1, 2025. City officials noted that the actual commencement of collection may be slightly later; the start date and implementation details will be set by a companion resolution at the council’s next meeting. Choosing an October 1 effective date is intended to ensure the revenue is collected at the municipal level; after that date, state policy will limit cities and counties from adding new related licenses or taxes. Separately, Alabama’s statewide vape tax is expected to begin on October 1, 2026.
For purposes of the ordinance, the taxable base follows Alabama’s definition of “vapor products,” including any non-ignited, non-combustion product that uses a mechanical heating element, battery, or electronic circuitry to generate a nicotine aerosol (regardless of form factor), as well as nicotine-containing cartridges, pods, or other containers used with such devices (e.g., electronic cigarettes, e-cigars, e-pipes). Products regulated by the U.S. Food and Drug Administration under Chapter V of the Federal Food, Drug, and Cosmetic Act are excluded from this scope.
The city stated it will adopt implementing rules at the next council meeting to confirm the start of collection and compliance requirements. Retailers and distributors should update pricing and settlement systems to ensure the correct rate is charged and remitted for transactions within the applicable jurisdiction.
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